USTAINAB VELOPME REPORT empresas cmpc s.a 1
Message from the Chairman of Empresas CMPC
8 Profile and Structure of the Organization
Mission, Values and Ethics in Business Corporate Governance 15
Corporate Social Responsibility
CMPC and its Business Chain
CMPC and its Workers
CMPC and the Community
Dialogue with Stakeholders Supporting the Mapuche Communities Relationship with Suppliers and Contractor Firms Relationship with Customers Personnel Education and Training Long Standing Labor Relations Risk Prevention Policy
CMPC Foundation Donations Good Neighbourhood Plan
CMPC and the Environment
Sustainable Use of Energy High Volume of Recycled Paper Biodiversity in CMPCâ€™s Forest Resources
108 GRI Index
Empresas CMPC is characterized by having a strong organizational culture, whose seal is keeping oneâ€™s word, honesty, work well done and personal effort, values that are shared by the entire organization.
The growth of its operations abroad, the diversification of products and markets, is the result of rigorous analysis, the professionalism, seriousness and long-term perspective of its business management.
Its commitment with the education of future generations, with the local communities and with the environment, reflects its flexibility to evolve and produce changes, true to its traditions but innovating when facing each new challenge.
Message from the Chairman OF EMPRESAS CMPC I am particularly pleased to present you with the CMPC’s Sustainable Development Report for the year 2009. This year has been CMPC’s 90th anniversary. We strongly believe, we have contributed effectively to the development of our country, creating job opportunities and wealth for Chile and that is why this anniversary makes us feel so proud of what we have achieved. It is also an occasion to look back and remember the legacy of our founders and of all those who have shown us the way forward, helping to create the hallmark in the way CMPC does business and also in the constant commitment to the development of our country and its people, especially those communities where the company operates. This anniversary comes at a very special time for CMPC. The purchase of forestry and industrial assets of pulp, papers and tissue in Brazil was hailed as a milestone in the future development of the 6
company. So, today we operate in eight Latin American countries and remain as committed as ever to the constant development that is even abroad. Our employees have played a key role in the growth of this company. To December 2009, the number of people working directly for CMPC reached 14,382; 5,943 of which (41%) work abroad. There are 50 unions and 57% of our employees are members; these organisations have been instrumental in creating a constructive and honest relationship between the company and its employees. That is why I would like to take this opportunity to reaffirm my appreciation to all our employees, executive leaders and union representatives, for their constant commitment and loyalty that have made the progress of CMPC possible. CMPC makes a serious and proactive effort in approaching communities, working together and having an open doors
policy. All this aims at creating opportunities of social and economic growth, especially for the 300 Mapuche communities living close to forests and areas where the company operates in Chile. This programme called “The Good Neighbourhood Plan” has placed special emphasis on developing projects such as direct employment for those neighbours from Mapuche origin, educational support programmes, and encouragement of productive development and microenterprises projects, as well as providing the communities with tools to improve their quality of life. Another aspect of CMPC’s constant commitment to working with the community is The CMPC Foundation which supports schools located near the areas where the company runs industrial operations. The work of this organisation aims at improving the provision of the education children receive to make sure they have access to more opportunities in life and can in return help their
community grow. The CMPC Foundation runs 3 programmes: teacher training, libraries and early stimulation, which in 2009 helped around 7,000 students, 400 teachers and principals in 51 schools located in 9 different areas. Apart from the direct work with schools organised by the foundation there are also educational, cultural and leisure activities available at the Jorge Alessandri Educational Park in Concepcion which had 121,000 visitors in 2009. We strongly believe in the actual realisation of the Sustainable Development principle, which essentially means to make productive activities, required for the growth of our countries, compatible with the legitimate right that future generations have to live in a suitable environment. Our environmental agenda observes this principle and contains four priority areas: development of renewable forest plantations, substitution of fossil fuels for biomass, certification of our clean production processes and increase in the recycling of paper. There is a growing demand from the society to protect and preserve the environment and the biodiversity of natural ecosystems; there is also universal concern over world climate change and how it is
affecting every aspect of modern life, from everyday activities to complex industrial processes. Our answer to these pressing matters is the sustainable development of all the forestry and industrial processes that CMPC carries out which are all certified to meet markets standards. A key asset for the company is the 147,000 hectares in Chile which were allocated to the protection and preservation of biodiversity. Of these, 7 areas with high environmental value protect endangered species of native flora and fauna. We are monitoring the carbon footprint of our products, initially pine and eucalyptus pulps. The result of this work will shortly be made available to our clients, suppliers and anybody else who might be interested. I would welcome your views shareholders, clients, suppliers, employees as well as government authorities and the communityâ€™s in general - about the content of this report. Your feedback is much valued and appreciated since it will allow us to improve in those areas which show weaknesses.
progress with both our forestry practices and industrial processes, always working towards the future but at the same time facing Todayâ€™s challenges, efficiently.
Eliodoro Matte L. Chairman Empresas CMPC
For the last 90 years we have moved forward in the path of 7
Profile and Structure of the Organization Profile of the Company > Empresas CMPC S.A. is a public corporation founded in 1920, of private capital, distributed at 31 December 2009, in 220 million shares and 7,085 shareholders. The company is controlled by the Matte group, with 55.83% of the share capital.
> Solid financial structure: » Low leverage and a well structured debt profile. » One of the best non government-owned corporate risks in Chile and one of the highest of the forestry sector worldwide: qualification BBB+, granted by Standard & Poor’s and Fitch Ratings.
> World class industrial assets. > Sustainable advantage in costs in its different business segments. > Organic and balanced growth. > Successful track record and proven management capacity.
> CMPC is one of the leading Latin American companies in the production and marketing of forest products, pulp, paper, tissue and paper products. > CMPC has diversified and balanced sales, both as regards products and destinations: it sells its products to more than 10,000 clients in over 55 countries.
CMPC in Figures
> 8,439 workers in Chile and 5,943 abroad. > Industrial operations in Brazil, Argentina, Peru, Uruguay, Mexico, Colombia and Ecuador, in addition to Chile. > Forest reserves of 499,000 planted hectares in Chile, 65,000 planted hectares in Argentina and 95,000 in Brazil. > Consolidated sales for US$ 3,124 million. > Assets for US$ 12,248 million and shareholder’s equity of US$ 7,258 million.
Mission, Values and Ethics in Business > CMPCâ€™s mission is to produce and market, on the basis of cultivated plantations, solid wood, pulp, paper, tissue and paper products, in a sustainable way over time, with superior and competitive quality, adding value to its shareholders and clients, and creating development opportunities for its workers and the local communities.
> Develops the talents and skills of its workers, achieving a strong identity, commitment and high performance in its work teams. > Uses modern technology in its processes, which comply with high standards of safety and protection of people and the environment. > Complies strictly with the laws and regulations in all the countries were it carries out its operations.
To achieve this purpose, CMPC: > Develops strong business relationships with global and diversified clients, on the basis of a business structure focused on the client and equipped with an integrated logistics network. > Applies the principle of Sustainable Development, contributing to the economic and social development of the country, while protecting the environment at the same time.
> Has a corporate culture based on the fulfillment of the given word, honesty, work well done and personal effort, values that are shared by the entire organization. > Rejects child work and forced work, and any type of discrimination.
> The Board of Directors of Empresas CMPC: Jorge Gabriel Larraín B., Martín Costabal Ll., Patricio Grez M., Juan Claro G., Eliodoro Matte L. (Chairman), Gonzalo García B. (General Secretary), Arturo Mackenna I. (Chief Executive Officer), Jorge Marín C. and Bernardo Matte L.
Corporate Governance > Empresas CMPC S.A. is regulated by Law 18,046 for Limited Companies and the Securities Market, and is subject to the regulatory authority of the Chilean Superintendence of Securities and Insurance. > The Company is led by a Board of Directors made up of seven members elected at the Annual General Meeting of Shareholders, who hold their seats for three years. 10
> The Board of Directors meets on a monthly basis to evaluate and decide the development of the company in economic, social and environmental matters. > The shareholders may express their points of view on the company’s performance in legally convened ordinary and extraordinary meetings. > All decisions taken by the Board of Directors that affect the corporate interests as well as any relevant fact are communicated
to the regulatory authority, the stock exchanges and the public in general. > CMPC accounts are revised and certified by external auditors, approved by the Board of Directors and reported to the regulatory authority and the public in general. > CMPC is subject to the supervision of various authorities and regulatory agencies in the different countries in which it operates.
Board of Directors of Empresas CMPC CHAIRMAN
Eliodoro Matte L.
> At www.cmpc.cl in the document Annual Report 2009, you will find a detailed description of the activities of the Board of Directors and the Committee of Directors in the year 2009, as well as the operations with related parties and different matters concerning the company’s corporate governance, on pages 10, 11, 48 to 59.
Juan Claro G. Martín Costabal Ll. Patricio Grez M. Jorge Gabriel Larraín B. Jorge Marín C. Bernardo Matte L. ComMITTEE OF DirectorS Martín Costabal Ll.
Patricio Grez M. Jorge Marín C. MANAGEMENT CHIEF EXECUTIVE OFFICER Arturo Mackenna I. GENERAL SECRETARY Gonzalo García B. CHIEF FINANCIAL OFFICER Luis Llanos C. EXTERNAL AUDITORS PricewaterhouseCoopers
Structure of the Organization > CMPC is an integrated forestry company structured as a Holding that operates through five Business Centers. The Holding is responsible for the strategic coordination and centralizes the functions of the areas of finance, internal auditing, legal matters and relationship with shareholders. > The five business centers are: Forestry, Pulp, Paper, Tissue and Paper Products. Each one of theme is headed by a limited company and has a Board of Directors made up of representatives of the controller, independent third parties and senior executives of the Company. Those boards meet on a monthly basis. > Each business center is managed independently, through a Managing Director, and has its own organization,
with commercial, technical, personnel and operations structures. > The map on the following page shows the five business centers of CMPC in the different countries in which it carries out its operations. > At www.cmpc.cl in the document Annual Report 2009, you will find a detailed description of the operations of the five business centers and their supporting areas, as well as the business development, production figures, sales, investments and main projects, on pages 14 to 25, 32 to 45.
The acquisition during 2009, of forestry and industrial assets related to pulp, paper and tissue products in Brazil, constitutes a relevant milestone for the companyâ€™s future.
REGIONAL PRESENCE OF THE CMPC BUSINESS CENTERS
1 Plant: Drypers Andina
3 Plants: ABSORMEX
Paper Products 1 Paper Bag Plant: FORSAC
Pulp 1 Mill: Guaíba (Celulose Riograndense)
Tissue 2 Mills: Melhoramentos Papéis
1 Plant: PROTISA
1 Mill: PROTISA
Paper Products 1 Paper Bag Plant: FORSAC
Forestry Plantations | 4 Sawmills | 2 Remanufacturing Plants 1 Plywood Plant
3 Mills: Santa Fe (eucalyptus) | Laja (pine) | Pacifico (pine)
Paper 2 Folding Boxboard Mills: Cartulinas CMPC 1 Packaging Paper Mill: Papeles Cordillera 1 Newsprint Mill: INFORSA Paper Distribution: EDIPAC Paper Recovery Centers: SOREPA
Tissue 2 Mills: Puente Alto | Talagante
Paper Products 4 Corrugated Boxes Plants: Envases Impresos Envases Roble Alto 1 Paper Bag Plant: FORSAC 1 Moulded-Pulp Trays Plant: CHIMOLSA
1 Mill: IPUSA
Tissue 2 Mills: Papelera del Plata | Naschel
Paper Products 1 Paper Bag Plant: FORSAC
Corporate Social Responsibility > CMPC develops stable and long-term relationships with its employees, business chain, the local communities and the environment. All of them play a key role in the corporate social responsibility policy.
Social Responsibility Policy > Social Responsibility constitutes an essential part of the CMPCâ€™s business model whereby the company establishes long-term relationships with the communities where it runs its operations, contributing to their social and economic development, helping the new generations to improve their education and employing skilled workers who carry out the production process using high safety standards and in harmony with the environment.
CSR In cmpc
Social Responsibility Policy Business Chain
> CMPC contributes to the development of the countries where it works, bringing about employment and wealth. > It manages its business operations efficiently. > It produces and markets high quality products. > It establishes strong business relationships with customers and suppliers. > It is a strong competitor in the market with quality products and competitive costs. > It provides clear, reliable and audited financial information. > It complies with legal, tax and market competition regulations. Workers
> CMPC makes training and professional development opportunities available to its employees.
> It puts great emphasis on risk prevention in complex industrial processes. > It establishes a very good working environment which in turn stimulates creativity and high performance levels. > It looks after its employees and their families by creating welfare programmes. > It fully complies with legal, social and employment regulations. Community
> CMPC has an open doors policy, intended to create development opportunities for the communities where it operates. > It encourages the creation of job opportunities for local residents. > It supports the education of local children and helps their
families through scholarships programmes. > It develops training programmes for local residents with courses that foster the establishment of microenterprises and cooperatives. The CMPC Foundation
> The CMPC Foundation actively supports the education in communities where the company has operations. > It helps primary school children from state schools to improve their academic results. > It develops teacher training programmes in the areas of Language and Mathematics and it runs school management workshops for principals. > It sets up school libraries and reading encouragement programmes. > It runs workshops that teach mothers how to support their small childrenâ€™s development. 17
> CMPC bases the sustainable development of its production processes on the generation of renewable energy with biomass, the efficient consumption of water and raw materials, the use of recycled fibres and the technical management of its renewable forest plantations. > It certifies the forest plantations management and industrial processes. > It protects the biodiversity in 147,000 hectares of native forests and basin protection areas. > It fully complies with the environmental law. 18
Dialogue with Stakeholders > Due to the diverse nature of CMPCâ€™s business centres and the different realities of the neighbouring communities, the way in which the company carries out its public relations is a reflection of that diversity. The educational programmes developed by The CMPC Foundation and by The Jorge Alessandri Educational Park, the Good Neighbourhood Plan developed by Forestal Mininco and the permanent support to local communities by CMPC Pulp mills, are all examples of CMPCâ€™s proactive approach and unstinting support to
actively contribute to both the community social and economic growth. > As follows, th ere is a list of CMPCâ€™s interest groups and how the company relates with them:
Shareholders > Ordinary and Extraordinary Shareholders Meetings. > Annual Financial Report, Quarterly Financial Statements and communication of essential and relevant issues. Investors > Regular meetings, telephone conferences and debt instruments issuing processes. > Regular reporting to the regulatory authority and to the stock market.
Workers > Coordination meetings with unions, collective bargaining, joint committees on health and safety at work, and training programmes. > Mi Papel Magazine; corporate intranet; leisure activities for employees and their families. Contracting Companies > Regular communication and meetings with contracting companies. > Training to guarantee the compliance with forest management, health and safety and environmental certification standards. Customers > Regular follow-up visits, after-sales assistance, regional encounters, attendance at meetings and seminars on the Paper Industry. > Newsletters at CMPC Pulp and at Cartulinas CMPC.
Local Authorities > Regular meetings between mill managers and local community authorities. > Meetings with government organisations to discuss issues on the company activities. > Coordinating the CMPC Foundation activities with local and regional educational authorities. > Taking part in public-private sector meetings, called by the local community authority, intended for supporting the local development by promoting entrepreneurship initiatives.
improving their performance in Language and Mathematics. > The Good Neighbourhood Plan programmes, intended to create local employment, support school curriculum and the Mapuche communities. > CMPC Pulp has developed programmes to help and support communities established in neighbouring areas from its pulp mills. > CMPC actively participates in traditional, agricultural and forest festivals, which take place every year in the communities.
Local Communities > The CMPC Foundation is aimed at supporting primary state school children for 19
Student Community Support Network > A website to support students and people in general is available; www.papelnet.cl contains detailed information on the forest, pulp and paper industry as well as on renewable forest plantations, clean production processes, paper recycling, the biodiversity and the environment protection. Universities and NGOs > Research projects carried out by CMPC and universities, mainly intended to protect and conserve the native flora and fauna’s biodiversity. > The participation in CorpAraucanía, a public-private organisation whose objective is to foster the productive development in the La Araucania Region. > The water20
quality monitoring programme in the Bío Bío River. This programme is carried out by CMPC, the Universidad de Concepción and several regional companies and industries. > The monitoring of the quantity and quality of the water associated with plantations and native forest in several micro-basins in the Bío Bío Region. This is a long-term project carried out by CMPC and the Universidad Austral de Chile. > The close collaboration with Etica en los Bosques, a non-governmental organisation, in initiatives intended to preserve and protect the native forests in the South of Chile. > The presence of NGOs in the audits carried out in the company regarding environmental management and protection of the biodiversity. > The collaboration with CODEFF in protecting and restoring the habitat of the Huillín, or freshwater otter. > Lectures by CMPC executives in several courses and trade fairs.
> In 1953, the small town of Laja had a population of 2,500 people, a train station, vineyards and people who enjoyed a quiet village life. Between then and until 1959, CMPC built what became the first pulp mill in Chile and the second in Latin America. It was opened in 1959 by the President, Mr. Jorge Alessandri. By then Laja was a town whose population reached 20.000 inhabitants in 1965, showing the fastest demographic growth in Latin America, according to ECLAC. In 2009, CMPCâ€™s Board of Directors approved a US$ 300 million investment to modernise the industrial complex in Laja. This project, currently under way, is the best present the Laja Pulp Mill could receive for its 50th anniversary and which will take it into the future, united in a common destiny with the town it grew up with.
The Good Neighbourhood Plan and support to Mapuche Communities > CMPC makes a serious and proactive effort in approaching local communities, working together and having an open doors policy. All this aims at creating opportunities of social and economic growth, especially for the 300 Mapuche communities living close to forests and areas where the company operates. > This project, called “The Good Neighbourhood Plan” has placed special emphasis on a direct employment programme for neighbours from Mapuche origin, educational support programmes and encouragement of productive development and microenterprises projects. All these initiatives have created strong and powerful links with the local communities. A detailed guide to all the 22
programmes for 2009 can be found from pages 60 to 81 of this report. > CMPC actively promotes the integration of The Mapuche communities and believes the key element to this is the appreciation of their culture. CMPC genuinely respects The Mapuches’ beliefs, customs, traditions and their lifestyle and supports all the efforts intended to preserve their ancestral knowledge of nature and biodiversity. > Since these sites are located in forest lands belonging to CMPC, both the identification and mapping processes are key to learning and preserving the sites which are of upmost importance for The Mapuche communities. CMPC will vigorously contribute to the preservation of these areas. > Generally speaking, The Mapuche sites of cultural interest were created by nature;
and according to The Mapuche view of the Cosmos, influenced by the topography of the land and by the existence of accumulated energies. These sites feature, ritualistic and ceremonial hills, known as “Txen Txen”, waterfalls or “Txayenko”, and wet lands where plants for medicinal purposes grow, known as “Menokos”. > Additionally, The Mapuche people created special sites for their rituals and ceremonies; the sites for religious ceremonies were called “Guillatuwe” and those for recreational activities were called “Paliwe”. The Mapuches play “palin”, also known as “chueca”, in these recreational places. > The next page shows some of the sites in which Forestal Mininco is carrying out a research work to preserve them for future generations and bring together both the ancestral Mapuche knowledge and modernity in the timber forests.
> Guillatuwe in Trintre, district of Los Sauces. A Guillatuwe is both an open space regarded as sacred by The Mapuche people, and where religious ceremonies take place.
> CMPC has started identifying sites of cultural interest for The Mapuche people, existing in areas belonging to the company. The data we have received is based on valuable sources of information, especially the feedback from neighbouring communities, people who know the area and the location of these sites, which are strongly connected with Mapuche tales and stories that have been passed down from generation to generation.
> Menoko in Trintre, district of Los Sauces. A Menoko is wet land where medicinally used plants with healing powers grow; it is also, according to The Mapuches, inhabited by spirits.
> Txayenko in Elicura, district of Contulmo. A waterfall which represents the purity of The Mapuche people, this is why special ceremonies take place here.
> Txen Txen in Trintre, district of Los Sauces. A Txen Txen is a ritualistic and ceremonial hill. It is also a landmark within a territory whose height allows a panoramic view of the landscape. This hill is connected with a nearby ritualistic place also known as Guillatuwe.
CMPC and its Business Chain > CMPCâ€™s productive activities are carried out balancing several aspects. The company cares about its employees, suppliers and customers. The fulfilment of contracts and the giving word, the quality of its products and responsible marketing, the good working environment and the timely payment of its financial obligations, are all part of this strong commitment.
Economic Performance > Even though 2009 was a particularly difficult year because of the global financial crisis that hit the markets hard, CMPC was able to move forward into the future by purchasing industrial and forestry assets in pulp, paper and tissue products in Brazil. These acquisitions are the direct result of CMPCâ€™s strong financial position and reputation, as well as the sound management of its operations. > CMPC secured its presence in Brazilâ€™s tissue paper industry with the acquisition of Melhoramentos PapĂŠis and did the same to enter the pulp, paper and wood business by purchasing forestry and 26
industrial assets from the Guaiba unit of Aracruz Celulose S.A. Economic Value Generated and Distributed
> The negative international environment in much of 2009 caused a decline in pulp prices and the prices and volumes of wood products. Such negative effects were mitigated by the realisation of several expansion projects as well as by the fall in prices of raw materials and relevant supplies, such as fuel, pulpwood and recycled paper. > In 2009, CMPC economic value
generated reached US$ 5,142 million, 35% higher than in the previous year, thanks to the financing activities related to the acquisition of assets in Brazil. > The economic value distributed of the company reached US$ 4,655 million, 27% higher than 2008; with a sharp increase in the purchase of fixed assets which was partially offset by a decrease of 12% in the payments to suppliers, contractors and services, due mainly to the lower cost of raw materials and supplies.
Millions of US$ Economic Value Generated
Sales of Fixed Assets and Others Subtotal of Operating Income
Net Effect of Financing Activities TOTAL ECONOMIC VALUE GENERATED
Millions of US$ Economic Value Distributed
Suppliers, Contractors and Services
Purchases of Fixed Assets
Payments to States
Donations TOTAL ECONOMIC VALUE DISTRIBUTED
TOTAL NET FLOW OF THE PERIOD
> ECONOMIC VALUE DISTRIBUTED 2009 SUPPLIERS, ContraCTORS AND ServicES
PURCHASES OF FIXED ASSETS
1.4% PAYMENTS TO STATES
PAYMENTS TO NATIONAL STATES
> The following chart shows the payments CMPC has made to the countries where the company runs industrial operations, including figures for Chile, Argentina, Brazil, Peru, Uruguay, Mexico, Colombia and Ecuador. In 2009 such payments totalled US$ 197 million, 5% higher in comparison with 2008; this increase was mainly due to higher payments in value added tax. Contribution to public infrastructure
> The development of CMPCâ€™s operations is characterised by large-scale transport of raw materials and finished products, especially the delivery of high volumes of wood supplies to the mills. That is why every year the company invests in building roads and bridges and paving of rural roads, as part 28
Millions of US$ 2008
Net Value Added Tax (VAT) Paid
Disallowed Expenses Taxes
Taxes on Financial Credits
Payments of Services Abroad
Commercial and Industrial Licenses
Minus Tax Exemptions and Credits
TOTAL NET PAYMENTS TO STATES
This includes consolidated figures of Chile, Argentina, Brazil, Peru, Uruguay, Mexico, Colombia and Ecuador.
INVESTMENT IN INFRASTRUCTURE BY TYPE OF INFRASTRUCTURE
Thousand of US$ 2008
of the requirements for the appropriate performance of its operations. > However, the works that CMPC carry out not only raise the standard of the roads but also improve both the
connectivity and the peopleâ€™s, from local villages, quality of life, which means a public benefit to the community. Between 2008 and 2009 CMPC invested US$ 7,8 million, with the breakdown shown in the upper table.
Sanctions and fines
> In 2009 CMPC paid US$ 171,000 in fines related to administrative, environmental and labour matters, mainly administrative fines in the Tissue and Forest business centres.
SANCTIONS AND FINES BY BUSINESS CENTRE
Thousands of US$ 2008
Paper Products Shared Services and Others Total
> Early autumn in a CMPC protected coigüe and oak forest, located in the district of Tucapel, Bío Bío Region.
Relationship with suppliers and contractors > CMPC’s suppliers’ network comprises both national and foreign companies which provide raw materials, equipment and supplies, as well as specialised services for different areas. > It is worth mentioning that in 2009, 1,400 Chilean contracting companies provided CMPC’s forestry and industrial operations with specialised and intensive services of skilled labour. Around 90% of these companies operate in a small and medium scale and are run by local businesses, making 30
an important contribution to the local economic growth of the regions where the company has forest plantations and industrial operations. > 60% of the transport fleet and 90% of the thinning equipment, used in the plantations, belong to o are carried out by local contracting companies. This directly benefits local neighbouring communities by creating job opportunities. > CMPC works closely with these contracting companies to achieve high standards in labour, health and safety, social and environmental issues. This collaboration
is based on continuous improvement, ongoing training, good rapport, and the emphasis on the adoption of a set of practices that represent the standards the company has on these matters. The following are of paramount importance for CMPC: » Compliance with labour and social laws, the creation of good working conditions and the total absence of child or forced labour. » Strict compliance with environmental legislation and with the high standards included in CMPC’s environmental and safety systems, which are a requirement for its ISO 14001, OHSAS 18001 and CERTFOR-PEFC certifications.
> However, local suppliers provide CMPC with products and quality services at a very competitive cost and delivery times compared to external non local alternatives. By
Âť A constant communication with its contracting companies to ensure high performance standards are met and also to detect any deviation from the established procedures and correct it. Purchase of Goods and Services from Local Suppliers
> In 2009, CMPC purchased 44% of its goods and services from local suppliers; this figure is slightly lower than the previous year, mainly due to modernisation projects carried out in the pulp mills, which meant a huge increase in the purchases from foreign suppliers.
supporting local businesses, the company contributes to the social and economic growth of the regions where its factories and operational centres are located.
PROPORTION OF PURCHASES OF GOODS AND SERVICES FROM LOCAL SUPPLIERS
% Regional Purchasing
BY BUSINESS CENTRE
Shared Services and Others
% Regional Purchasing BY COUNTRY
A Local Supplier is one located in the same province or region as the factory or head office of the respective business centre.
Forest Investment Programme > Forestal Mininco is developing a business plan which stimulates small and medium land owners to take part in the forestry production chain.
in which 45 small and medium landowners are growing highvalue plantations. Forestal Mininco supports these businesses by providing them with administrative, genetics and technology support as well as with it silviculture expertise.
> This programme, called Forest Investment, currently covers 7.000 hectares of land
> With this programme, CMPC shares its good environmental and plantation management
practices, the landowners earn an income from the first year the forest grow on their lands and they also commit the future timber production to the company. > This programme helps stop natural erosion processes experienced by unproductive soils, by establishing new forests which renew the soil.
> The establishing of Radiata pine seedlings in Mr. Aquiles Mezaâ€™s estate, located in the district of San Javier. Mr Meza was the first landowner to enter the programme and his motivation to take part in it, was to obtain the forest bonus, to have incomes during the growing period of his plantation and to keep his land as an inheritance to his heirs.
> Certified landowners and their associates visit the Santa Fe Pulp Mill as a part of technical transfer activities, to learn of the importance of getting good quality wood for the pulp production process.
Certification Programme for Sustainable Forest Management of Small and Medium Landowners > CMPC Pulp and Forestal Mininco are developing a programme which certifies the sustainable forest management of small and medium landowners who supply CMCP‘s mills with pulpwood. By December 2009, 17 landowners, covering 37,000 hectares, had been granted the CERTFOR-PEFC certification. > This programme allows CMPC to share with the certified landowners its good practices related to labour, protection of the environment and relationship with neighbouring communities. All of which are required to obtain the CERTFOR-PEFC certification.
> Visit from certified landowners to CMPC’s Rucamanqui estate in the district of Tucapel, where they are being trained in Eucalyptus Nitens plantation management in low temperatures areas.
> CMPC’s CERTFOR-PEFC certification programme is annually performed an audit by an international firm. In this picture, auditors interview some forest workers pruning on a certified estate in the district of San Javier, to make sure the labour standards required for the certification are met.
Relationship with Customers > CMPC’s customers are both Chilean and Foreign companies that operate commercial and industrial businesses, such as manufacture, distribution and retail. > CMPC maintains a close link with their customers and is aware of the important role they play in the social rating and the economic success of the company. Generally speaking, this relationship involves the commercial aspects as well as the technical development of the company’s products. > Through proactive credit policies that support the development of its customers’ businesses, 34
CMPC builds mutually beneficial relationships with its customers. > To constantly improve technical performance of its products, CMPC attends fairs and provides tailor made after sales support to its customers. > Moreover, CMPC actively takes part in trade, business and industry associations, both in Chile and abroad, and is also an active member of binational chambers of commerce. > The labelling of CMPC products contains all the information required by the industrial field or other type of customer, according to the nature of the product and whether it is destined to industrial use or massive consumption.
> In Chile, EDIPAC, a paper distribution company, subsidiary of CMPC, was awarded “Best Provider of Year 2009” by the Chilean Printers Association. This is the result of the company’s professionalism, quality in service and contribution to the national printing business.
> The marketing and advertising of the Tissue products comply with the ethical standards set by the Self-regulatory Advertising Council and come into the line with the values and ethics of the company.
» The folding boxboard used in food packaging is HACCP certified and ISEGA approved, which makes it suitable to come in direct contact with food. » The paper bags used in food packaging are also HACCP certified.
Customers’ Health and Safety
> CMPC constantly monitors the impact that its products have –throughout their life cycle– on customers’ health and safety. The analysis applies to tissue and sanitary products, folding boxboards and paper bags intended for food packaging. » The components in the tissue and sanitary products are subjected to a strict safety analysis, and microbiological testing to ensure their stability throughout time, as well as dermatological testing is run to guarantee they are hypoallergenic. 35
CMPC and its Workers
> For CMPC it is important to enable its employees to develop their talents and skills, so as to make them part of a high performance team that is enthusiastic, committed, innovative, collaborative and has a real sense of identity.
Sharp increase in the number of CMPC employees in Latin America > By the end of December 2009, a total of 14,382 people were employed by CMPC and its subsidiaries, 14.4% higher than in 2008. Such an increase - 1,815 people - was mainly due to the purchase of pulp, paper and tissue assets in Brazil, as well as by the growth in the CMPC’s tissue operations in Latin American countries.
45% of CMPC’s total personnel. This business centre has industrial operations in 8 Latin American countries, as shown on the map on page 13.
cmpc personNEl (as of 31 December of each year) BY BUSINESS CENTRE
Shared Services and Others TOTAL
> The employees from the Tissue business centre accounted for 38
Forest 13.5% Pulp 12.3% Paper 12.7% Tissue 44.9% Paper Products 14.0% Shared Services and Others 2.7%
> CMPC PERSONNEL BY BUSINESS CENTRE 2009
> The Tissue business centre itself employed 1,765 more people, an increase of 38% over 2008. This rise in the number of workers is a result of the purchase of Melhoramentos Papéis in Brazil and also of the growth in the company’s operations in Peru, Mexico, Ecuador, Uruguay and Colombia.
> In 2009, employees for CMPC working abroad totalled 5,943 people, which represent 41.3%
of the companyâ€™s personnel. The figure is higher than in 2008: 3,703 employees worked abroad.
CMPC personNEl (as of 31 December of each year) BY COUNTRY
United States TOTAL
> CMPC PERSONNEL BY COUNTRY 2009
> The number of female employees grew from 7.6% in 2007 to 9.2% in 2008 and then by December 2009, it reached 9.5%. The highest number of female employees was observed in Colombia and Mexico with 39% and 26% of female staff respectively. > CMPCâ€™s personnel figures show a balance in the percentage of people employed in relation to age groups.
> Percentage of Personnel by Ages
Under 20 years, 1.4%
Between 20 and 29 years, 24.4%
Between 30 and 39 years, 34.2%
Between 40 and 49 years, 25.5%
Between 50 and 59 years, 12.1%
60 years and over, 2.4%
Ecuador 0.9% Brazil 11.9% United States 0.1%
Internal communication that integrates personnel from all the countries > The CMPCâ€™s continuous international growth requires the company to develop and upkeep internal communication systems that promote and strengthen its corporate culture. The Tissue business centre, which has seen a substantial geographic expansion, holds a Regional Workshop where the General Manager meets employees from all the countries. These workshops are held every year and give management and staff a chance to discuss operational, market and strategic issues. > Continuous, transparent and proactive communication with the Unions from all CMPC subsidiaries. > â€œMi Papelâ€? magazine has 40
proved to be a very effective communication tool. It features topics related to the daily activities carried out by employees as well as activities aimed at their personal and professional growth. This magazine is distributed to all CMPC employees, both in Chile and abroad. > Newsletters, made by each business centre, feature news, activities and also highlight the work of outstanding employees. > A dynamic intranet portal features both useful contents and online help to carry out professional tasks. In addition, it is a direct communication channel to share ideas, transmit suggestions and concerns.
Equal Job Opportunities and No Discrimination Policy > CMPC is an equal opportunities employer and will, from the start of the recruitment process, consider whether the applicant is eligible or not based only on their experience and abilities relevant to the position applied for. > CMPC fights discrimination based on race, religion, genre, sexual orientation, nationality, age, marital status, political views, union affiliation or social background. > Female applicants are not required to take a pregnancy test as part of the application process; neither are they asked to do it if they are successful. For female employees, their progression within the company is not conditioned by the absence of pregnancy.
Education and in-service training: a company at cutting-edge technology > CMPC employees have achieved a high level of specialisation and efficiency, 29% holds an academic degree, or finished tertiary education. A large proportion of our workers are qualified to carry out complex production processes. > Low level of staff turnover:
1.5% in 2009, slightly lower than 2008 (1.8%). CMPC offers its employees opportunities to develop a career within the company and encourages them to undergo training. CMPC also offers its employees job security, good working environment and additional benefits.
employees with a deep feeling of satisfaction.
> In-service training is essential to guarantee the sustainability of the companyâ€™s future businesses. Education and ongoing training, which go hand in hand with productivity improvements, also provide
CMPC Personnel 2009: senior management, professionals and technicians, workers
BY BUSINESS CENTRE
Professionals and Technicians
Shared Services and Others
> In 2009, 187,000 hours were committed to staff training from all the areas in the company. This is one of CMPC’s most outstanding achievements in this matter. > 31% (out of 187,000 hours), was committed to staff from the company’s operations abroad, compared to 16% in 2008.
> CMPC’s in-service training programmes are designed taking the long-term into account. This means ongoing training, and when new technology and industrial processes come in, additional reinforcement sessions are introduced. This proves especially useful when a new factory is being set up, as was the case of CMPC Tissue in Colombia.
In-service Training Hours 2009 BY BUSINESS CENTRE
Paper Products Shared Services and Others TOTAL
These figures do not include in-service training courses given internally in the mills with their own staff.
> Workers who will operate the tissue rolls conversion line in the Gachancipá mill, receiving training.
Training for the Gachancipa people: a new CMPC Tissue mill in Colombia > The growth in the Tissue operations in Colombia made it necessary to build an industrial plant in Gachancipá, situated 45 Km North of Bogotá. The town of Gachancipá has a population of 10,000 inhabitants and its economy is based largely on flower cultivation. > CMPC decided to create job opportunities for the local community. The company together with the Gachancipá local authority and the Colombian National Learning Service developed a 7–month programme to train local workers in the operation of
> The assembly of the paper machine by workers and people in charge of the project.
industrial plants. The results obtained at the end of the programme were used to recruit personnel for the newly opened plant. > While the construction process was underway, the workers recruited started a one-month course on paper machinery and tissue converting lines; the workshop took place at the local council facilities. The technical components of the course were presented by specialised personnel from the Peru Tissue subsidiary, which is familiar with the kind of paper machinery that would be installed in Gachancipá, because it is identical to the one currently being used in Peru. > Once the theory component
of the course was over, the workers were appointed to work as trainee at the Lima Tissue Mill in Peru. This training went on for 2 months, at the end of which they were fully skilled in the use of paper machinery, fibre preparation processes and auxiliary systems. > At present, 60 people, coming from Gachancipá, are working in what will soon be the Gachancipá Tissue Mill, and are taking an active role in the operation of the first conversion line and in the assembly of the paper machine, both of which will be fully operational by November 2010. This fact has been regarded, by the community, as a contribution to the economic growth of the region. 43
Close proximity to local communities > Because of CMPC’s commitment to the communities where the company is present, it is of upmost importance that operations in these areas are led by high-ranked personnel who either come from these areas or have permanent residence in the communities situated near the company’s facilities. > This improves CMPC’s communication with neighbouring communities and has a positive effect on taking part in activities related to the Corporate Social Responsibility, which the company carries out through the CMPC Foundation, The Good Neighbourhood Plan and the support to neighbouring communities. > In 2009, 89% of CMPC’s senior and middle managers came from or had permanent 44
residency in the areas close to the company’s operational plants. This figure is slightly higher than in 2008. > The figure above is due to CMPC’s policy of fostering an
actual integration with local communities and of actively getting involved in their social and economic growth, through a close relationship with local authorities and neighbourhood organizations.
Percentage of Senior and Middle Managers coming from or having permanent residency in localities close to the company's facilities BY BUSINESS CENTre
Paper Products Shared Sevices and Others TOTAL
Trustworthy longstanding working relationships > CMPC values a good working environment since it believes it has a positive effect on both individual and team work. The company’s effective coordination with unions has been instrumental in establishing a continuous, proactive and transparent communication between management and CMPC’s employees.
» The N°1 Workers Union of Papeles Cordillera, dating back from 1927, it is the oldest Chilean Union. » The N°2 Workers Union of Papeles Cordillera, established in 1931.
porcentage of Union Memership BY BUSINESS CENTre
> Regular meetings, written communications and consultation with union representatives, have contributed to strengthen the mutual trust between the company and its workers, and have improved policies related to working conditions and employee benefits.
» The N°1 Workers Union of Laja Pulp Mill, established in 1961. » The N°2 Workers Union of Laja Pulp Mill, established in 1966.
Shared Services and Others TOTAL
> There are 50 unions that represent 57% of the CMPC’s employees. The oldest unions are:
> By the end of December 2009, 69% of CMPC’s employees were covered by collective bargaining agreements currently in force.
Percentage of employees covered by collective agreements BY BUSINESS CENTre
Shared Services and Others
> Scholarships, school bursaries and sports activities for employees’ children, as well as leisure activities for staff. Education, birth and death allowance.
2009 63% 83% 100%
> The company offers its employees loans to cover the operational costs of buying a house. > CMPC has put into practice several healthcare programmes for its employees, such as immunisation, preventive medicine, a welfare service, complementary health insurance, and discounted prescriptions, dental care and prescription glasses. CMPC employees can also get subsidised hospital and private care. > Leisure and cultural activities for employees and their families, such as sports, drama, music and singing.
Risk Prevention Policy: working towards a healthier and safer working environment > At CMPC, advances in safety and occupational health have been achieved by a joint effort with the workers, their unions and other labour
representatives. This work has experienced some significant advances over time: » Appropriate safety elements made available to employees, which allow them to carry on their daily activities safely. » Standard operations procedure manuals for employees. » Joint Committees, companyemployees. » Healthcare and health insurance programmes.
porcentaGe OF WORKERS REPRESENTED IN JOINT COMMITTES BY BUSINESS CENTre
Shared Services and Others
2009 99% 84% 100%
> 94% of CMPC’s employees actively participate in joint committees dealing with Order, Hygiene and Safety. In Chile, these committees are established in accordance with Law N° 16.744. For the company’s operations abroad, the most relevant aspects of the Chilean legislation have been homologated.
Risk Prevention Policy > CMPC’s Risk Prevention Policy is geared up to protect employees’ life and health, neighbouring communities and the environment. We also aim to protect our facilities and the operational continuity of our production processes. > A special mention for the Zero Fault Plan from CMPC Pulp and for the Corporate Safety System from CMPC Tissue. Both plans have essential elements in common: » They are inspired by the OHSAS 18,001 standard and integrate the management of environmental risks, protection of facilities and the coordination of emergency response with institutional and local authorities. » They emphasise the cultural change in employees, making them aware of the operational risks for both people and the environment. 48
> Santa Fe Pulp Mill’s annual parade, August 2009. CMPC’s employees and staff from service companies wear safety equipment. The event lasted 15 days during which more than 3,000 people took part in essential maintenance work in the mill, as well as repairs and modernisation of equipment and facilities. The team focused mainly on Safety and Environmental issues, and no accidents involving the loss of working hours were recorded.
» They are designed to incorporate staff from all areas of the company. » Both plans are regularly revised and updated in terms of operational and emergency procedures. » These plans identify the areas in each mill according to their risk level and allocate teams responsible for delivering a coordinated and prompt response.
> The Laja Pulp Mill reached 1,000,000 working manhours, accidentfree - done effectively by both permanent staff and contractor companies - without any waste of time. This remarkable achievement in safety was on August 28th 2009.
> Regarding safety and occupational health statistics, staff absence levels have
remained low, with an average of 2.0%. In 2009, accidents totalled 551, a figure 5.3%
lower than in 2008. 12,333 days were lost due to accidents, 14% more than in 2008.
Safety and Occupational Health Statistics 2009 Rate of Absenteeism BY BUSINESS CENTre
N° of Cases with Professional Illnesses
Shared Services and Others
Nº of Accidents
Nº of Fatal Accidents
Average Employees in the year
2009 Rate of Absenteeism BY COUNTRY
Nº of Cases with Professional IIInesses
Nº of Accidents
Nº of Fatal Accidents
Average Employees in the year
Rate of absenteeism = total number of days with medical leave of absence / (average number of employees in the year * 365 days)
CMPC and the Community > CMPC becomes involved in the challenges and aspirations of the local communities where it runs industrial operations. To do so, the company carries out educational support and community development programmes that benefit the neighbours of its forest lands and factories, in order to improve their quality of life.
The CMPC Foundation: planting the seeds of the future for today’s children > Since 2000 the CMPC Foundation has been supporting the educational work in schools situated near the company’s premises. This work aims at improving the quality of education the children receive, so that they can have better opportunities in life, as well as development in the local communities. Teacher Training Projects
> The Teacher Training projects are designed to support teaching staff and principals from primary schools and help them improve their teaching practice so that students obtain better results in Language and Mathematics. To accomplish this, CMPC developed several projects: » Teacher training in Language, Mathematics and School Management. » Revision and planning workshops. 52
» Advisory services to both teachers in the classroom and principals at schools. » Evaluation of the children’s learning. > 6,746 students benefited from the programme, > 51 schools in 9 districts, > 370 teachers and principals, > 3,356 hours of training and advice, 38% more than in 2008.
“We have received valuable retraining, we have been supported by outstanding teachers and we have received the support of superb didactic material. I would like to take this opportunity to thank the CMPC Foundation that made this experience possible. This contribution helps us better both ourselves and the education in our country.” Statement by Maria Cecilia Orellana, pre-school teacher at Manuel Rodriguez School, district of San Javier.
> Teachers attending retraining sessions under the guidance of lectures by professionals from the CMPC Foundation. These sessions deal with teaching practice and contents that teachers can apply in Language and Maths lessons.
> Professionals from the CMPC Foundation also advise to principals on School Management and Teaching support follow-up.
> By improving the childrenâ€™s performance in Language and Maths, the foundations are laid to improve their quality of life.
School Library Project
> The School Library project was designed to encourage children, parents and teachers to read more. Reading is a key element of both learning and cognitive development.
> This project ran from 2005 to 2009 in the districts of Nacimiento and Negrete. During this time the number of book loans grew considerably. Libraries are now open to schools and local communities and have become a very important part of the
educational project in every school. > 9 libraries opened to 5,052 students and their communities. > 281 teachers and principals got trained.
> Reading for pleasure is the basis of childrenâ€™s growth and learning process as it favours communication and language development, creativity and culture.
â€œI had no idea that important things, such as being a mother, could be taught.â€? Statement by a mother, who attended the early year stimulation workshops in Nacimiento.
The Growing-up together Project
> The Growing-up together project is oriented to stimulate, through the partnership of parents and schools, the cognitive, sensory-motor and socio-emotional development in children between 2 and 6 years old from the district of Nacimiento. > In 2009 pre-school teachers and practitioners received training; parents were given the opportunity to attend talks and workshops. The local people received counselling, as well as seminars and evaluation sessions.
> 436 mothers and their children benefited from this project. > 32 pre-school teachers and principals received training at 5 schools and kindergartens.
> Pre-school children have a huge learning potential, therefore parents must learn how to encourage them to develop their cognitive, emotional and social capabilities.
Cultural Projects in Nacimiento, Laja and Mininco
> Throughout 2009, cultural projects were developed for Nacimiento and Laja in the Bio Bio Region and for Mininco in the Araucania Region. These projects included activities such as dance lessons, drawing, belly dance, singing and guitar lessons, Latin-American dance and computer literacy courses. The people also had the opportunity to enjoy movies, plays and outdoor concerts.
> In 2009, the Tree Room was modernized with new interactive games to show the production cycle of wood, pulp and paper and the environmental protection carried out by CMPC.
“My neighbour and I made up our minds to give these activities a try so realised that it is never too late to learn new things” Statement by Norma Rebolledo, a neighbour from Nacimiento.
> Since its opening in 1993, the Jorge Alessandri Educational Park has received over a million visitors. Located between Concepcion and Coronel, the Park’s main purpose is to, through free educational and cultural activities, share the production, forest and
environmental management of Empresas CMPC. > The Park features the following: » The Park Trails and The Native Forest give visitors the opportunity to experience nature and enjoy a unique ecosystem. » At the Tree Room, in a playful environment, children learn
> In 2009, the Jorge Alessandri Educational Park received 121,369 visitors, 11% higher than 2008.
> Families and school groups visiting the Educational Nursery, learn about flora species and the preservation of natural resources.
about the timber industry and the production processes of wood, pulp and paper. » At the Educational Nursery, visitors learn about tree species and their use in the timber industry, medical science and decorations business. » At the Cultural Amphitheatre, during summer, visitors can see artistic performances. There are also exhibitions taking place at the central square and at the
showroom. » The Museum Artequin is an interactive instance for children to get familiar with the main Occidental art works. The Future Museum Artequin in Los Angeles
in this city. The project will take art closer to children and will open a cultural space for the local community. During 2009 some curatorial work was done as well as the design of educational proposals and architectural studies.
> Both CMPC and The Municipal Council in Los Angeles are working out a plan to build a Museum Artequin 57
The CMPC Foundation and its achievements
> The 2009 SIMCE test (Quality of Education Measuring System) in Language and Mathematics, showed some improvements in the results obtained by schools supported by the CMPC Foundation. These results were higher than the national average. > Some outstanding results were achieved by schools in the districts of Yerbas Buenas, San Rosendo and Negrete; in all three of them the general scores were considerably higher compared to previous years. Negrete has shown a constant improvement since 2006, which
has placed this district among Chileâ€™s 20 best performing municipal education system. > Schools supported by the CMPC Foundation in the districts of Talagante, San Javier and Mulchen achieved their highest ever score in Language. > The School Luis Ambrosio Concha in Yerbas Buenas is one, out of the 20 schools that improved
significantly between 2008 and 2009. > The School Toqui Lautaro in Nacimiento is one, out of the 20 municipal schools whose results have dramatically improved in the last 10 years. > The schools Maintencillo in Yerbas Buenas, Capilla de Caleu in Til-Til, Dollinco in Nacimiento, Callejones in San Rosendo and Bernardo Oâ€™Higgins in San Javier, achieved results that are above the average for schools from the same socio-economic level and funding.
Donations “During 2009 the CMPC Foundation provided our schools with such a substantial support, that schools from Nacimiento could stand out at both local and regional level. I am certain that all the hard work done by CMPC professionals was sown in fertile soil, so that enthusiasm, optimism and perseverance grew in all of us”.
In 2009, donations from CMPC totalled US$ $4,928 thousands, 69% higher than 2008. The educational projects from the CMPC Foundation together with the support to universities and to education in general, represented 56% of the company’s total social contributions. Thousands of US$ donations
The CMPC Foundation
Universities and Education in General
Academic Foundations, Associations, NGOs
Donations Law N° 19,712
Donations Law N° 19,885 TOTAL
Statement by Luzgarda Novoa, Principal at School Toqui Lautaro in Nacimiento.
The Good Neighbourhood Plan and the support to neighbouring communities > CMPC seeks to create opportunities for social and economic development for the communities neighbouring the companyâ€™s forest operations and facilities. Forestal Mininco has developed an open door policy towards rural communities, especially the Mapuchesâ€™. This, known as The Good Neighbourhood Plan, is designed to create job opportunities, educational support programmes, as well as train and up-skill local residents to make the most of their contribution to the community. > Moreover, the CMPC Pulp Mills
are supporting the neighbouring communities from Nacimiento, Laja, San Rosendo, Collipulli and Renaico districts. > On the following pages, a summary containing the main programmes that Forestal Mininco and CMPC Pulp have developed to help their neighbouring communities is presented.
Job Opportunities for Local Communities > In 2009, 670 positions were created for residents of
the Mapuche communities, as part of the programme to incorporate local labour to the forestry work carried out by the company. > Residents are employed by forestry service companies and receive training on health and safety, risk prevention and environmental protection. This enables them to perform different tasks in forest lands, such as plantation establishment, herbicide application and the activities of pruning, thinning and harvesting.
> Forestry tasks being performed by Mapuche residents from the Collipulli district, using traditional harvest methods.
Programmes to support The Studentsâ€™ Education from neighbouring communities
> Students from the El Vergel Agricultural School and their tutors.
School Bursary Programmes
> In 2009 the Rural Bursary Programme created by Forestal Mininco helped 102 students from families on a low income to stay in full time education. The money the families receive helps towards the cost of textbooks, toiletries and travel expenses. Students who have the benefit of education come from 45 schools in the Maule, Bio Bio and Araucania regions. > The El Vergel Bursary Programme, developed in collaboration with the El Vergel Agricultural School - belonging to the Methodist Corporation of Angol - helped 30 students to achieve a technical qualification in agriculture. The funds granted by Forestal Mininco
help school students afford uniforms, textbooks, stationery and weekly travel expenses to their homes. Music Programme
> Under the slogan â€œMusic: a bridge between the community and its cultureâ€?, Forestal Mininco has been carrying out an artistic training programme which encourages the school community, students, parents and teachers to learn about music and to take part in bands.
a musical instrument and keep local, national and regional folk music alive. > Through musical expression, students develop skills that facilitate their integration to the social and school environment as well as having a positive effect in their communities, where CMPC runs its operations. > In 2009, 48 schools - from 24 local districts - and 1,911 students, parents and teachers took part in this programme.
> This programme gives students the opportunity to learn 61
1 3 1 > Band from The Quidico School in Tirua. 2 > Band from The Pellines School in Empedrado. 3 > Band from The Tapihue School in Pencahue. 4 > Band from The Canada School in Collipulli.
School Tree Nursery Programme
> This programme allows students from rural schools to grow eucalyptus plants and native species trees in nurseries built within the school grounds.
> With the help of their teachers, students learn how to make plants grow and how to look after trees. > In 2009, Forestal Mininco supported the building of tree nurseries in 14 schools.
1 > Students and their head teacher from G-1045 School in Millapoa, district of Nacimiento, showing the nursery where they are growing trees. 2 > Tree nursery at G-1044 School in Las Corrientes, Nacimiento. 3 > Tree nursery at N째 7 Private School in El Carrizal, Nacimiento. 63
Supporting Students Training at Liceo de Nacimiento 1 > As part of their curriculum, students at Liceo de Nacimiento take part in electro-control and mechanics workshops at the CMPC Santa Fe Pulp Mill. These workshops give students the opportunity to experience a highly demanding industrial environment.
Robotics workshops 2 and 3 > Engineers from CMPC Laja and Santa Fe Pulp Mills work with students on a Robotics workshop which will develop their creativity, innovative thinking and team work.
Programmes to support the Mapuche communities
potential and to develop associations that will enable them to reach common targets.
Horticulture and Fruit
> The Rewe Communities Association in Cholchol, formed by 22 Mapuche communities consisting of 550 families, became part of CorpAraucania, an organisation that promotes
Venture in Cholchol
> CMPC collaborates with the Mapuche communities to encourage their production
the development of the La Araucania Region. This partnership created a strong link with the business world, which in turn helped the Rewe Association to carry out the plantation of berry orchards in lands owned by the families.
> The signing of the cooperation agreement and the traditional Mapuche rogation ceremony to protect the new business venture.
> The construction of the drip irrigation system.
> Start of the raspberries plantation.
> The orchards first harvest.
> As their very first project, 8 hectares of land owned by the families belonging to the Association were used to grow Heritage raspberries.
> The Rewe Communities Association and Forestal Mininco signed a cooperation agreement by which the latter provided the drip irrigation technology necessary to water the raspberry plantation as well as training the landowners on how to use it.
> This project benefits both the members of the Association and seasonal temporary workers who are in high demand when the harvest time arrives.
the Huape-Antiquina area and Forestal Mininco. The courses are intended to recover the Mapuche’s ancient techniques of weaving.
Mapuche Loom Courses
> Courses on Mapuche loom were introduced as part of an agreement signed by the Cañete Municipal Council, CONAF (the National Forestry Corporation), 8 Mapuche communities from
> The courses mentioned above were attended by Mapuche
communities from Antiquina, Huape-Puañil, Huape-Epullan and Collico, all in the Cañete district. By attending these courses the communities will be able to turn this new skill into family support income.
2 1 > Preparation of the herbs to dye the wool. 2 > The wool-dyeing process. 3 > Participants from one of the courses. 4 and 5 > Crossing threads on a loom.
> The Mawida Nocha programme (Mountain Nocha) has been created to allow the Mapuche communities to grow Nocha in established nurseries in their land.
> The Nocha is a plant that grows in the native forest, far
from populated areas. Its long and thin leaves are used in traditional Mapuche basketry. > In 2009, 20 Nocha nurseries were built, using materials supplied by Forestal Mininco and labour supplied by local residents. The plants grown in these nurseries will provide the material artisans need to work.
1 > The preparation of the land and the materials to build the nursery. 2 > The newly-built nursery. 3 and 4 > The planting of the Nocha plants. 5 > The Nochas are ready to grow in a controlled environment. 4
Teaching the Mapudungun
> Mapudungun is the Mapucheâ€™s people ancient language that has progressively disappeared; this is not only a loss to the Mapuche community but a loss to the worldâ€™s linguistic heritage. Luckily, this situation can be reversed by actively contributing to its preservation as a live language.
1 y 2 > The Interactive Mapudungun Dictionary.
> Forestal Mininco is currently working on a Multimedia Mapudungun Dictionary, which will help children aged 6 and 7 in the process of learning the language. > By introducing this interactive dictionary in schools, the project seeks to bring children closer to the Mapuche culture by helping preserve their language and stimulating its everyday use. 3 > The Fourth Regional Encounter of Mapuche Folklore at Villa Mininco, Araucania Region, on April 18th 2009. The CMPC Pacifico Pulp Mill working with the Communal Union of Mapuche Communities of Collipulli, has carried out many activities for the community such as Mapuche loom classes, Mapudungun language lessons and traditional Mapuche folklore encounters.
Programmes to stimulate the productive development of neighbouring communities Non-timber forest products collection
> Non-timber forest products include a variety of wild fungi, fruit, vegetables, aromatic and healing herbs, which grow on Chilean forests. It is estimated that the process of these products employs around 220 thousand people, 90% of whom are women. > In 2000, The Taller de Accion Cultural - a NGO known as The Cultural Action Workshop -, started a programme of wild fruit picking in six communities in the Bio Bio Region. The workers, mainly women, were encouraged to establish committees to organise their work, this later led to the construction of processing plants which added value to 70
the products. Currently, around 50 different dried products are obtained from this activity and four years ago they began being exported. > Forestal Mininco actively supports 2,000 neighbours in the process of wild fruit picking in land owned by CMPC. The company grants entry permits, trains the workers on health, safety and fire prevention,
break schedules and provides emergency telephone contact. > Additionally, the company funded the publishing of the book “Healing plants, sharing experiences and knowledge”. The book compiles the knowledge of the Bio Bio Regional Pickers Association which is formed by the 7 picking committees from that region.
> The book “Healing plants, sharing experiences and knowledge”.
1 and 2 > The picking process. 3 and 4 > The processing of the picked products.
The Tagasaste breeding programme: a fodder plant
> The Tagasaste is a leguminous fodder plant (Chamaecytisus Proliferus), which grows very well in poor quality soils and can endure dry seasons of up to 5 months.
1 and 2 > The planting of the Tagasaste plants onto local residentsâ€™ lands. 3 and 4 > A detailed image of the Tagasaste plant.
> Forestal Mininco takes part in the development of nurseries to grow the Tagasaste plants which are afterwards planted onto farm land owned by local residents. > In 2009, 7,500 Tagasaste plants were bred in 21 nurseries across 17 districts. > 119 local residents planted the Tagasaste plants onto their land to feed their livestock as well as to sell it as fodder. > It is estimated that this programme will produce 52,000 new plants in 2010, which will be bred in 26 nurseries. 72
Forest Grazing Programme
> Tagging the livestock.
> This programme supports cattle breeding in the district of San Nicolas, by taking advantage of the resources available in the forest. > The company is helping small scale cattle producers to ensure they meet the productive and economic targets they have
set for themselves. Ten families are involved in implementing a system to breed about 200 livestock, calves and lambs.
> Livestock producers joining the 2009-2010 programmes.
Agricultural development in The Huelehueico Valley
> CMPC Pulp and the Renaico Municipal Authority are carrying
out an agricultural development programme in The Huelehueico Valley; this programme allows small scale farmers who live near the Pacifico Pulp Mill,
to implement new farming techniques and to use high quality inputs. This scheme has helped the farmers to improve the productivity on their lands.
Training courses for neighbouring communities
> In 2009, 112 courses were attended by 1,100 female residents and by 162 male residents of areas surrounding CMPC’s forest lands and facilities. > These courses were designed after asking the neighbours which areas they would be interested in. A total of 20 areas were identified.
> Out of the 20 areas, the 12 that attracted more interest were: » Crafts and wicker basketry » Cooking and baking » Local produce preserving » Dressmaking using a sewing machine » Hand-made dressmaking » Dehydration of fruits and vegetables » Elaboration of handmade soaps and perfumes » Home basic electrics » Agricultural and livestock health and management » Hive preparation and beekeeping health » Eucalyptus plant production in a community nursery » Basic wool-knitting
1 > Local produce preserving course for neighbours of the Pelehuito sector, district of Los Sauces. 2 > Cooking and baking course for women of the San Francisco de Millapoa Neighbours’ Association, district of Nacimiento. 3 > Hand-made dressmaking course for local residents of La Quebrada sector, district of Los Angeles. 4 > Beekeeping for neighbours of the Huelehueico Valley, district of Renaico. 23 people who live near the Pacifico Pulp Mill learnt how to manage the hives and to produce honey. 5 > 20 neighbours from the Santa Fe Pulp Mill in Nacimiento attended welding classes. At the end of the course and also as a final evaluation, the participants get to make several utensils. 6 > Chainsaw basic maintenance course for residents of the Mapuche community of Rayen Lafquen in the district of Cunco. 7 > Course in making handmade soaps and perfumes for neighbours of the Santa Elena Community, district of Angol.
1, 2 and 3 > The Park “El Cisne” is looked after by the Local Neighbours’ Association.
Programmes to Support Urban Communities Mulchen in Bloom
> The city of Mulchen has a population of 30 thousand people. It is situated near a CMPC sawmill and near some of the company’s forest plantations. The Mulchen in Bloom project seeks to give 78
this city a floristic identity by propagating the existent varieties of Rhododendrons, Azaleas and Camellias that grow in The Park “El Cisne” situated in the outskirts of the city. > This is an 8-year project that involves the participation of the Municipality of Mulchen, the Forest Technology class at the local high school, the
Neighbours’ Association from El Cisne sector and Forestal Mininco. > The propagation of these plants is being carried out in nurseries established at the Park “El Cisne”; afterwards they will be planted in parks, gardens and public spaces across the city. All the people mentioned above contribute to make this project a reality.
4, 5 and 6 > Nurseries for the propagation of the plants. 7 and 8 > Students from the Forest Technology class work on propagating the plants. 9 > The first plant which will grow in one of the cityâ€™s parks.
CMPCÂ´s sports facilities for the community > In Nacimiento, CMPC Pulp set
up an indoor sports hall with synthetic flooring which can be used to play different sports. A football pitch, 3 tennis courts and a multipurpose hall were
also built and all these facilities are available for the community and its organisations, through an agreement between CMPC and the Municipality of Nacimiento.
> Neighbours visiting the Laja Pulp Mill.
CMPC Mills site visits
> CMPC production facilities are visited by neighbours, social organisations, students and people from different institutions. Visitors learn about the clean production processes, the strict health and safety regulations and the respect towards the environment. CMPC thinks that rapport with the community is fundamental for a good relationship.
> Visitors at the Talagante Tissue Mill.
CMPC AND THE ENVIRONMENT > The main contributions that CMPC makes to the environment are the renewable forest plantations, the replacement of fossil fuels with biomass, the clean production processes and the paper recycling.
CMPC and its responsibility towards the environment > CMPC believes in the actual realisation of the Sustainable Development principle, which essentially means to make productive activities, required for the growth of our countries, compatible with the legitimate right that future generations have to live in a suitable environment. > CMPC’s environmental agenda prioritises four areas: renewable forest plantations, replacement of fossil fuels with biomass, clean production processes and paper recycling. It must also be mentioned: » Certified wood supply from renewable plantations of controlled origin. » Efficient use of both electric and thermal power. » Thermal power generated mainly by renewable biomass. » Reduction in water consumption and in the volume of the liquid effluent. » Reduction in the liquid effluent organic content that goes back into the natural watercourses. » High volume of paper recycling.
Sustainable Management of Forest Plantations > The wood CMPC uses comes from fast-growing renewable plantations which were established mainly on eroded land, allowing both the soil to be renewed and the conservation of native forests. > To guarantee the protection of native forests and the biodiversity, the sustainable management of CMPS’s forest plantations is certified by the CERTFOR-PEFC seal which guarantees the wood comes exclusively from controlled origin plantations, free from controversies and perfectly traceable from the forest to its final destination. > The CERTFOR-PEFC seal is the main certification for the bulk of the CMPC plantations whereas the FSC seal certifies plantations covering a smaller area. Since the second half of
2009 all of CMPC’s forestry resources in Chile are in the process of being FSC certified, getting the completion of the pre-audit stage which set the tasks to be carried out in the final audit, scheduled for December 2010. > CMPC’s forest plantations are specialty crops which provide all the wood required in the production processes using a
relatively small area of land. This makes it possible to conserve and protect the rich biodiversity of the Chilean native forests. > Wood is the main raw material used at CMPC’s sawmills and pulp and paper mills. In 2009, the company produced 7.7 million cubic metres of CERTFOR-PEFC certified logs.
CMPC’s Forestry Resources in Chile
» Production Area: » 499,000 hectares of renewable plantations. » 33,000 hectares of land to be planted. » 38,000 hectares of land used for administrative purposes, including roads, firebreaks, easements, livestock and agricultural areas, etc. » Protection and Conservation Area: » 58,000 hectares of both native forest and vegetation. » 89,000 hectares for protecting basins, watercourses, flora and fauna and high environmental value habitats.
> In 2009, the total purchases of wood from external suppliers totalled 1.8 million cubic metres of logs. These purchases were
made from small and medium landowners who comply with strict regulations established by the company under a CERTFOR-
PEFC certification programme, as can be seen on page 33 of this report.
> 10-year-old Ponderosa Pine plantation in Coyhaique. CMPC has planted 16,000 hectares of this and other species which adapt to the extreme winter conditions prevailing in the region. The soils used in these plantations showed different degrees of erosion.
Sustainable use of energy > The pulp and paper industry uses a great amount of energy, most of which is obtained from renewable biomass generated through the forestry processes, thus reducing the use of fossil fuels.
> In 2009, CMPC’s production processes of pulp and paper used 67,692 TJ (terajoules) of energy, of which 74.2% came from biomass, 11.6% came from purchasing electricity and 14.2% came from energy generated by fossil fuels, mainly oil and natural gas. This means
that only 25.8% of the energy required was bought, whereas 74.2% was produced by biomass.
> cmpc ENERGY CONSUMPTION » YEAR 2009 (67,692 Terajoules)
» YEAR 2008 (68,936 Terajoules) biomasS
> Energy consumption in 2009 decreased by 1.8% compared to 2008. This was due to a more efficient use of thermal
power and a reduction in the productive capacity of the Laja Pulp Mill.
cmpc ENERGY CONSUMPTION in Terajoules cmpc consolidaTED
One Terajoule is the energy equivalent to 278 MWh.
> The biomass used to generate energy comes from the sustainable management of the forest plantations and from the reutilisation of organic components found in wood, which result from the pulp production process. The main sources of biomass are: » Wood waste coming from managing the forest plantations, resulting from the natural grow of trees and later from their harvesting. » Sawdust and wood cuttings generated by industrial sawmills. » The bark of trees which is separated from the wood prior to the pulp production process.
» Lignin –an organic component of wood– which is separated from the pulp and thoroughly reutilised as biofuel in the production process. » Sludge generated by the treatment of liquid effluent. > This biomass is used in industrial boilers to produce steam, also known as biomass boilers. Wood lignin is reutilised as fuel for recovery boilers, which are essential in the pulp production process. > The high pressure steam produced by these boilers circulates through turbines. This generates electricity which is
enough to thoroughly meet the operational requirements of the pulp mills and even generates surplus electricity for other CMPC’s mills to use.
> Biomass being transported to the Pacific Pulp Mill boiler.
> In 2009, the Board of Directors approved the construction of two biomass boilers which will generate electric power for both the Santa Fe and Laja Pulp Mills, with a US$ 200 million total investment.
Sustainable use of water
the previous year.
> In 2009, CMPCâ€™s production processes of pulp and paper used 139.7 million m3 of water, 3% less than in 2008, whereas the pulp and paper production reached 3.177 million tonnes in 2009, slightly higher than in
> The average water consumption per tonne of pulp and paper decreased to 44 m3 from a level of 45.4 m3 in 2008, which is a 3% reduction. > That reduction in water
cmpc Water consumption cmpc consolidaTED
In thousands of cubic metres per year In cubic metres per tonne of end product
consumption was mainly due to an improved performance of all the paper mills, especially those of Tissue in Argentina, Uruguay and Mexico. > CMPCâ€™s water intake did not have a negative impact on the water sources. 89% of the water the company consumed was obtained from surface sources and 11% from groundwater sources.
> The Bio Bio River on its course through the district of Santa Barbara, Bio Bio Region.
Treated Liquid Effluent
> In 2009 a total of 125.3 million m3 of effluent was treated, 4% less than in 2008, mainly due to lower water consumption in the production processes.
> The liquid effluent generated per tonne of pulp and paper was 39.5 m3, a 4% reduction from a level of 41.2 m3 in 2008. > Treatment plants are periodically monitored to
TREATED LIQUID EFFLUENT cmpc consolidaTED
In thousands of cubic metres per year In cubic metres per tonne of end product
check that the liquid effluent parameters meet the respective regulations. In 2009 four of these parameters showed a reduction compared to 2008, as can be seen in the Effluent Quality Parameters chart below, due to the full operation of biological treatment plants in the CMPCâ€™s mills.
Liquid Effluent Quality Parameters cmpc consolidated
2008 Kg/Tonne prod.
2009 Kg/Tonne prod.
% reduction (-) % increase (+)
COD Chemical Oxygen Demand
BOD Biological Oxygen Demand
TSS Total Suspended Solids P Phosphorus
AOX Organochlorine Compounds
> As a result of the liquid effluent treatment, sludge which has a high content of vegetal fibre is obtained. This waste poses
no hazard for the environment and can be recycled and used as biomass, mainly in steam generation for the production
processes, since the heating power it provides is suitable to be used in biomass boilers.
> The new biological treatment of the liquid effluent at the Pacifico Pulp Mill. The secondary clarifier can be seen foreground. On the left the concentric structure with bioreactors inside and the activated sludge tank as an outer ring can also be observed. The result of this process is a final clarified liquid effluent that has received both primary and biological treatment and which is returned to the natural watercourses.
> New system of incinerating concentrated non-condensable gases at the Pacifico Pulp Mill. At the bottom centre the primary incinerator and the steam generating boiler. At the top, the sulphur dioxide absorption tower and its exhaust stack. On the left, the old incinerator will act as a back-up for the new system.
> Air emissions generated by combustion processes are made up of particulate matter and gases vented into the atmosphere, mainly sulphur dioxide (SO2) and nitrogen oxides (NOx). These emissions are periodically monitored and passed onto the environmental authority according to the current legislation. The chart below shows the air emissions generated by CMPCâ€™s production processes, expressed in kilograms per tonne of pulp and paper. AIR EMISSIONS
> In 2009, the particulate matter emitted by the pulp and paper mills was 0.89 kilograms per tonne of product. This figure is 15% lower than in 2008, mainly due to a better performance of the mitigation equipment and the greater availability of natural gas in Chile. > Sulphur dioxide emissions were reduced to 0.74 kilograms
2008 Kg/Tonne prod.
2009 Kg/Tonne prod.
per tonne of product, a 27% reduction in comparison to 2008. Again, this is mainly due to an increased availability of natural gas.
> Nitrogen oxides emissions totalled 1.36 kilograms per tonne of product, 9% less than in 2008.
> The following chart shows the
tonnes of solid waste generated by CMPCâ€™s pulp and paper mills:
Solid WastE CMPC ConsolidateD
Hazardous Solid Waste Sold or recycled Sent to specialized dumps Non-Hazardous Solid Waste Sold or recycled
Sludge used to produce steam
Sent to own landfills
Sent to third parties' landfills
> In 2009 only 0.3% of the total solid waste was considered to be hazardous. Such a waste is subject to regulations established by the Decree NÂ° 148 of 2003 by the Ministry of Health, stating that every factory has the obligation to declare, manage and carry out follow-up checks on the hazardous waste it generates. > The remaining 99.7% of the 94
waste was regarded as nonhazardous, 17.3% of which was recycled either as heating power for biomass boilers or for environmental purposes. Finally, 82.4% of the waste was taken to licensed landfills either owned by the company or by third parties, for the controlled disposal of it. > The chart above shows a 16% increase in the volume of
} } }
17.3% 82.4% 100.0%
the waste generated by CMPC compared to 2008. This is mainly due to the growth in the Tissue operations abroad. > Worth mentioning is the Zarate Tissue Mill in Argentina, where the non-hazardous solid waste is subjected to a composting process whose end result is an organic product used to improve the quality of agricultural soils.
High volume of paper recycling
> In 2009, the consumption of recycled paper at CMPCâ€™s paper mills totalled 693,000 tonnes, slightly higher than in
2008. This figure means that approximately 46% of CMPCâ€™s total paper production in Chile, Argentina, Peru, Uruguay, Mexico and Brazil, was based on recycled fibres.
Recycled Paper ConsumptioN 2008
Mills in Chile
Mills in Argentina, Peru, Uruguay y Mexico
In thousands of tonneS
> Paper recycling process in Santiago, Chile.
> Both the recycled and virgin fibres from forest plantations complement each other in papermaking; when paper is recycled the fibres lifetime becomes longer, thus leading to a better use of the forestry resources. > Since the recurrent recycling processes cause the fibres to deteriorate, hence the need to incorporate virgin fibres into the paper production process, thus showing the complementary nature of both fibres. > In Chile, Argentina, Peru, Mexico and Colombia, CMPC has organisations that specialise in recycling. These organisations carry out the recovery, sorting out, baling and delivery processes. After taking the used paper to the paper mills, this is turned into useful fibres, thus beginning a new lifecycle.
The environmental and social benefits from CMPCâ€™s paper recycling process:
> Optimises the forest plantation cycle by using recycled instead of virgin fibres in papermaking. > Saves up energy since the process of producing recycled fibres from used paper consumes less energy than using wood to obtain virgin fibres. > Regards both used paper and cardboard as raw material, consequently a market that fosters their collection through pricing is opened, preventing them from ending up in a landfill. > Reduces the amount of waste in landfills. Methane gas emission from waste decomposition is cut down. > Creates job opportunities for urban non-skilled labourers who work in the paper collection process. > Helps to keep the cities clean.
CMPCâ€™s Environmental Investments
> In 2009, the CMPCâ€™s environmental investment programme totalled US$ 69 million, which breakdown is shown in the following chart.
> The bulk of that figure was invested in the environmental updating of the Pacifico and Santa Fe Pulp mills. Such investments were focused on controlling air emissions, the biological treatment of liquid effluent and on making a more efficient use of energy.
Consolidated Environmental Investments In millions of US Dollars
Air emission control
Liquid effluent treatment
Solid waste management
Environmental safety of facilities and people, prevention and control
Energy and water savings
> Biomass boiler at the Pacifico Pulp Mill.
> CMPC’s subsidiaries Papeles Cordillera and Cartulinas CMPC are ISO 14001 certified.
CMPC’s Certification of its Sustainable Processes
> Forestal Mininco has the ISO 14001 environmental management certification and the OHSAS 18001 for health and safety at the workplace. The CERTFOR-PEFC seal is the main certification for the bulk of the forest plantations whereas the FSC seal certifies plantations covering a smaller area. > The three CMPC Pulp mills are ISO 14001 and OHSAS 18001 certified.
> The Tissue subsidiary in Uruguay is OHSAS 18001 certified. > The pulp produced at the Laja, Pacifico and Santa Fe mills, the folding boxboard produced at the Maule mill and the sawmill products have the CERTFORPEFC Chain of Custody certification. > The eucalyptus pulp produced by the Santa Fe mill, the folding boxboard produced at the Maule mill and the AFH tissue papers produced by Melhoramentos Papeis in Brazil have the FSC Chain of Custody certification.
CMPC’s contribution to mitigate the Global Climate Change
> The worldwide concern over climate change affects all aspects of modern life, from everyday activities to the most complex industrial operations. CMPC’s efforts are focused on reducing fossil fuels consumption by replacing them with renewable energies. > CMPC contributes to reducing the emission of greenhouse gases by: (1) Growing pine and eucalyptus plantations which are carbon sinks. We estimate that our plantations absorb more than 5 million tonnes of carbon dioxide a year,
compensating for 1.2 million automobile annual emissions.
Confederation of European Paper Industries.
(2) Reducing the consumption of fossil fuels and replacing them with biomass which not only is a renewable energy but is also carbon neutral. Currently 74% of CMPC’s annual consumption of energy is generated from biomass.
> This piece of work was carried out by a group of professionals from CMPC and counted on the advice and consultancy from the University of Concepcion through its Technological Research Institute. The results of the present research work will soon be available for CMPC’s stakeholders and anyone interested on it.
(3) Recycling around 700 thousand tonnes of used paper per year to preventing it to end up in landfills and generate methane gas – a greenhouse gas - emissions because of decomposition. > Here at CMPC we have measured the Carbon Footprint of both eucalyptus and pine pulp and the folding boxboard, following the guidelines and methodology of CEPI - the
> Rucamanqui High Environmental Value Area, where CMPC protects 5,189 hectares of Rauli, Coigue and Oak native forest. 100
CMPC’s Forestry Resources Biodiversity Central Chile is a World’s Biodiversity Hotspot
CMPC’s role in the
> Central Chile is one of the World’s 25 Biodiversity Hotspots, known as the Chilean Winter Rainfall-Valdivian Forest, which extends from Coquimbo region to the South of Chiloe Island.
> CMPC’s forestry resources in Chile include 147,000 hectares for conservation purposes, which are fundamental for the sustainable development of the company:
> That biodiversity hotspot area contains species of endemic trees that are essential within specific habitats: Araucaria (Araucaria araucana), Alerce (Fitzroya cupressoides), Hualo or Oak of Maule (Nothofagus glauca), as well as two critically endangered species: Ruil (Nothofagus alessandrii) and Pitao (Pitavia punctata).
protection and conservation of biodiversity
of threatened species of flora and fauna and identifying, conserving and restoring seven high environmental value areas.
» 58,000 hectares of both native forest and vegetation. » 89,000 hectares for protecting basins, watercourses, flora and fauna and high environmental value areas. > As part of the CERTFORTPEFC forest certification requirements, CMPC works on protecting native forest, learning and preserving its environmental value, determining the presence 101
High Environmental Value Areas in Chile > These areas have relevant values for native flora and fauna conservation, so they are protected to prevent potential damages from forestry operations, fire and other human activities. > CMPC protects seven high environmental value areas totalling 6,200 hectares, located in the Maule, BioBio and Araucanía Chilean regions. Valuable species from the Valdivian native forest are preserved, including Ruil, Pitao, Araucaria, and also native fauna, such as the Huillín or fresh-water otter. > Those areas have special conservation and protection plans and they are given priority in the CMPC’s fire prevention system.
Los Ruiles de Empedrado High Environmental Value Area
> CMPC protects 60 hectares of Ruil in a pure state, a species of native flora endemic of Chile, declared in critical danger of extinction. It is classified as the most critically endangered tree of Chile. The forest is located in the district of Empedrado, Maule Region, and is part of the “Cardonal-Linda Vista” priority conservation site, declared by the CONAMA - the Chilean environmental authority.
Pitao de Maitenrehue High Environmental Value Area
> CMPC protects 26 hectares of Pitao, a species of native flora endemic of Chile, declared in critical danger of extinction. The forest is located in two areas in the districts of Nacimiento, Bio-Bio Region, and Angol, Araucanía Region. This Pitao population has unique genetic characteristics that differentiate it from other northern populations.
Villa Las Araucarias High Environmental Value Area
> CMPC protects 85 hectares of Araucaria, a species of native flora endemic of Chile and Argentina, declared as vulnerable. The forest is located in the district of Nueva Imperial, Araucanía Region and is part of the “Villa Las Araucarias” priority conservation site, declared by the CONAMA. This Araucaria population is genetically different from those in the Nahuelbuta Range and The Andes. 103
Alto Escuadrón High Environmental Value Area
> CMPC protects 160 hectares of Valdivian native forest, located in a gorge at the beginning of the Nahuelbuta Range, in the district of Coronel, Bio-Bio Region. This area is part of the cultural and educational activities developed by the nearby Jorge Alessandri Educational Park.
Hualos de Loanco High Environmental Value Area
> CMPC protects 680 hectares of Maulino native forest, located in the district of Constitucion, Maule Region. This forest has a population of Hualo or Oak of Maule (Nothofagus glauca), a species declared as vulnerable, and its fauna includes the Black Woodpecker, a species declared in danger of extinction. This area is part of the “Galumávida and Hualos de Loanco” priority conservation site, declared by the CONAMA. 104
Huillín High Environmental Value AreA
> It is a protection zone for the Chilean mammal Huillín (Lontra provocax), a fresh-water otter declared in danger of extinction. The protected area is a stretch of about five kilometres on the banks of the Boldo or Queule River and in the wetlands of Mahuidanche, district of Tolten, Araucanía Region. This area is part of the “Mahuidanche-Lastarria” priority conservation site, declared by the CONAMA.
Rucamanqui High Environmental Value AreA
> CMPC protects 5,189 hectares of Rauli, Coigue and Oak native forest, located in the upper basin of the Cholguan River, district of Tucapel, Bio Bio Region. This area is part of the “Biological Corridor of the Nevados de Chillán-Laguna del Laja” priority conservation site, declared by the CONAMA. 105
Feria Exponativa > Forestal Mininco took an active part in the Feria Exponativa, "Boundaries of preservation", organised by the NGO Etica en los Bosques (Forest Ethics) and the Municipality of Pucon, AraucanĂa Region. This event gathered Tradition and Modernity, from wood industry to handicraft and ecotourism. All of them joined by a common view: their practice regarding environmental protection and conservation.
USTAINAB VELOPME REPORT empresas cmpc s.a 107
GRI Index - compliance level a profile GRI indicator
STRATEGY AND ANALYSIS
Statement of senior person responsible
Description of the main impacts, risks and opportunities
PROFILE OF THE ORGANIZATION
Name of the organization
Empresas CMPC S.A.
Main brands, products and services
Brands related to tissue and sanitary products: Elite, Confort, Nova, Noble, Higienol, Sussex, Babysec, Ladysoft, Cotidian.
Structure of the organization
Countries in which the company operates
Regional presence of the business centres
Nature of ownership and legal form
Sales over 55 countries
Size of the organization
CMPC in figures for year 2009
Significant changes during the period
There were no significant changes
2.10 Prizes and distinctions received
Award to Edipac, a paper distribution company, subsidiary of CMPC
Date of the most recent report
Report presentation cycle
Point of contact
About this report
Report’s content definition process
The primary objective was to point out the essence of CMPC’s business model and the relationship with its workers, corporate chain, local communities and the environment. The subjects were defined by reviewing the social and environmental performance of the year 2009.
Coverage of the report
It includes all the components of the CMPC's Social Responsibility Policy
Limitations of the report’s scope or coverage
Does not include the quantification of CMPC’s contribution to mitigate the climate change, based on growing forest plantations and the generation of renewable energy.
Inclusion of joint ventures
It includes the information of CMPC’s entire business chain.
Data measurement and bases for calculation
Methodologies and calculations have been standardized among the different subsidiaries, in a fluid process with rigorous internal verifications.
Effect of restating information contained in previous reports
Improvements have been made in the way some indicators were measured, which produced minor changes in some figures reported in the year 2008.
Changes in relation to previous periods
There were no significant changes
Table of contents
3.13 External verification
No external verification was made
GOVERNANCE, COMMITMENTS AND PARTICIPATION OF STAKEHOLDERS
Organization’s governance structure
Chairman of the Board
The Chairman of the Board of Directors is not an executive of CMPC
Independent Board members
Of the 7 members of the Board of Directors, two have been appointed by independent shareholders.
Mechanisms of shareholders and employees for making recommendations to the Board
The shareholders may express their points of view on the company’s performance in legally convened ordinary and extraordinary meetings.
Remuneration of directors and senior executives
The Directors do not have a variable remuneration for achieving objectives in the economic, social or environmental areas. The senior executives’ remuneration is linked to performance.
Procedures to avoid conflicts of interest in the Board
A Committee of 3 Directors, two of them independent of the controller, revises and pronounces on operations with related parties, examines the financial statements and the reports issued by external auditors.
Training and experience required from members of the Board
Board members qualifications are determined by the shareholders at the Annual General meeting, who vote the candidates with proved competence and knowledge.
Mission, vision and values
Mission, values and ethics in business
Procedures of the Board of Directors to supervise the organization’s economic, social and environmental performance.
4.10 Evaluation of the Board’s own performance 4.11
Description of how the organization has adopted a precautionary principle
CMPC applies the principle of Sustainable Development in all its operations and new industrial projects it carries out, complying with high standards on safety, protection of neighbouring communities and the environment.
Social, environmental and economic programmes developed externally
CMPC has not subscribed formal commitments with global international initiatives in social, environmental or economic matters.
4.13 Associations to which the organization belongs
CMPC actively takes part in trade, business and industry associations, both in Chile and abroad, and is also an active member of binational chambers of commerce.
4.14 List of stakeholders
Dialogue with stakeholders
4.15 Basis for selection of stakeholders
Dialogue with stakeholders
4.16 Approach adopted for the inclusion of stakeholders
Dialogue with stakeholders
Relationship with universities and NGOs
Relationship with the Mapuche communities
Identifying the Mapuche sites of cultural interest
Key topics and concerns arising through the participation of stakeholders
Relationship with suppliers and contractors
Good Neighbourhood Plan Protection and conservation of Biodiversity
ECONOMIC PERFORMANCE Economic value generated and distributed
Financial consequences and risks due to climate change
This calculation has not been made, although the contribution that CMPC makes towards the mitigation of climate change should be considered
Coverage of the organization’s obligations due to social benefit programmes
CMPC complies with the system of social security obligations in all the countries in which it operates.
Significant financial assistance received from the State
No significant financial assistance is received from the State.
Range of wage ratios
Practices and purchases from local suppliers
Purchase of goods and services from local suppliers
Job opportunities for local communities
Local hiring and resident managers Infrastructure investment and services provided for public benefit
Local residency of senior management of the operations
Contribution to public infrastructure
Programmes to stimulate the productive development of communities
Programmes to support urban communities
Wood coming from renewable plantations
Environmental Performance EN1
Percentage of materials valued
All the raw materials and supplies are valued
Direct energy consumption
Sustainable use of energy
Indirect energy consumption
Energy consumption in 2009 was 1.8% lower than 2008.
Products and services based on renewable energies
74.2% of the energy consumed was generated with renewable biomass.
Reduction of indirect energy consumption
In 2009, the Board of Directors approved the construction of two biomass boilers which will generate electric power for both the Santa Fe and Laja Pulp Mills.
Total water intake by sources
Sustainable use of the water
Water sources affected significantly
CMPC’s water intake did not affect the water sources.
Sustainable use of water
EN10 Recycled and reused water EN11 Protected or high biodiversity areas
CMPC’s forestry resources in Chile CMPC’s forestry resources biodiversity
EN12 Impacts on biodiversity in protected areas
CMPC’s role in the protection and conservation of biodiversity
EN13 Protected or restored habitats
High environmental value areas
EN14 Management of impacts on biodiversity
CMPC’s role in the protection and conservation of biodiversity
EN15 Species whose conservation is threatened
In CMPC’s forestry resources there are 5 species of native flora declared in danger of extinction and another two declared as vulnerable, which are protected. There are also two species of native fauna declared in danger of extinction and one species declared as vulnerable.
EN16 Greenhouse gases emissions
EN17 Other indirect emissions of greenhouse gases
EN18 Iniciatives to reduce greenhouse gas emissions
CMPC’s contribution to mitigate the Global Climate Change
EN19 Ozone-depleting compound emissions
CMPC does not emit gasses that might affect the ozone layer.
EN20 NOx, SO2 and other air emissions
EN21 Total volume of liquid effluent
Treated liquid effluent
EN22 Weight of the managed waste
EN23 Most significant accidental spills
No significant accidental spills have been recorded
EN24 Hazardous solid waste according to the Basel Convention
EN25 Water resources and habitats affected
No water sources or their related habitats were affected CMPC’s environmental agenda 2009
Iniciatives to mitigate the environmental impact of products Energy generated with renewable biomass and services Sustainable use of the water
High volume of paper recycling
85 101-106 101 102-105 101
98 93 91-92 94 94 84 87-89 90 95
EN27 Percentage of products recovered at the end of their useful life Not reported EN28 Significant fines of an environmental nature
There were no significant fines of an environmental nature.
EN29 Environmental impact from transport
Contribution to public infrastructure
EN30 Environmental investments
CMPC’s environmental investments
By business centre
Labour Practices and Work Ethics LA1
Composition of workers
By type of employment 110
Total number of employees and average turnover
Low turnover level
Social benefits for full-time employees
CMPCâ€™s employee benefits
Percentage of employees with collective bargaining agreements
Employees covered by collective bargaining agreements
Minimum period of notice for organizational changes
Trustworthy long-standing working relationships
Workers in joint commitees on safety and health
Risk prevention policy
Absenteeism, occupational diseases, days lost
Occupational health and safety statistics
Training, education, risk prevention and control programmes
Risk prevention policy
Health and safety topics covered in formal agreements with unions
Risk prevention policy
LA10 In-service training hours per category of employee
Education and in-service training
LA11 Continuous training programmes
Education and in-service training
LA12 Regular evaluations on performance and development
LA13 Personnel by genre and age
Personnel by genre and age
LA14 Wage distinctions by genre
CMPC does not make wage distinctions based on genre
Human Rights HR1
Percentage and number of investment agreements with human rights clauses
CMPC extends its obligations in this matter to its suppliers. Nevertheless, no measurements are made.
Percentage of distributors and contractors evaluated in human rights matters
CMPC extends its obligations in this matter to its suppliers. Nevertheless, no measurements are made.
Training of employees in human rights matters that are relevant to their activities
CMPC forbids any type of discrimination and conduct contrary to human rights. Nevertheless, no training courses are taught.
Incidents of discrimination
No incidents of discrimination have been recorded in the period.
Activities in which the right to freedom of association is at risk
Trustworthy long-standing working relationships
Activities that involve child work
CMPC rejects any practice related to child work
Activities that risk forced or compulsory work
CMPC rejects any practice related to forced work
Percentage of the security personnel with training in human rights
CMPC extends its obligations in this matter to the security personnel. Nevertheless, no measurements are made.
Incidents related to the rights of native tribes
The Good Neighbourhood Plan and support to Mapuche communities
Good Neighbourhood Plan
Supporting the Mapuche communities
Management of operational impacts on the communities
No follow-ups related to this subject are made
Training in anti-corruption procedures
Mission, values and ethics in business
Measures in response to corruption incidents
No incidents took place related to this subject
Participation in the development of public policies
CMPC contributes to the development of public policies, participating actively through industrial associations in the stages of formal consultation that are established while proposed legislation is being discussed in Chile.
Financial contributions to political parties
Lawsuits due to cases against free competition
None took place
Sanctions and fines monetary value
Sanctions and fines
PRODUCT RESPONSIBILITY PR1
Customers' health and safety impacts
Customersâ€™ Health and Safety
Incidents due to nonfulfilment of PR1
None took place.
Information required on the products
CMPC develops a complete labelling of its products, and informs its clients on the technical specifications including composition, raw materials, physical values in tests applied, quality standards and accredited health and safety certifications.
Number of nonfulfilments of PR3
None took place
Customer satisfaction surveys
The CMPC Tissue business centre carries out periodic customer satisfaction surveys because its products are destined to massive consumption.
Adherence to marketing communications standards, including publicity, promotion and sponsorships
CMPC adheres to the principles of the National Association of Advertisers of Chile, related to freedom of speech in commerce, self-regulation and advertising ethics.
Number of incidents due to nonfulfilment of PR6
None took place.
Complaints regarding customerâ€™s privacy
None took place.
Significant fines related to products supply
PLEASE SEND US YOUR OPINION We are interested in knowing your opinion of our 2009 Sustainable Development Report; therefore please fill in the attached sheet and send it by fax to number (56-2) 441 2477 or by e-mail to email@example.com. 1. In which group of stakeholders would you classify yourself? Employee / Contractor Shareholder Customer Supplier Authority / Regulator NGO Community Other. Which? Please answer the following questions with an evaluation from 1 to 7, where 1 is bad and 7 the best. 2. What score would you give to the following aspects of CMPCâ€™s Sustainable Development Report? Transparency Balance Contextualization of the industry Structure Length Clarity / Precision Coherence with the strategy Depth of the information
3. Did the CMPCâ€™s Sustainable Development Report provide the information you were expecting? Yes No, why not?
If the score of your expectations is below 5, please let us know what additional information you would have liked to receive:
Thank you for your time.
Published on Jan 1, 2009